Senate approves no pay, no play bill

SANTA FE (AP) - The Senate on Sunday approved a "no pay, no play" bill limiting damages to uninsured drivers - but with a rate-reduction mandate its sponsor said is a killer.

The bill is part of a package of changes sought by Republican Gov. Gary Johnson to reduce the number of uninsured motorists.

Backed by the insurance industry, the measure would limit the damages uninsured drivers could collect if they were injured in accidents.

But the Senate on Sunday narrowly agreed to keep in the bill a requirement added by a committee that insurance companies lower their motor vehicle premium rates 15 percent on Oct. 1.

"Certainly that was designed to kill the bill," said Sen. William Payne, R-Albuquerque, its sponsor. He said he would try to get it stripped off in the House.

Insurance companies contend a "no pay, no play" law would result in lower rates - but they can't say just how much.

Fifteen percent would devastate the insurance industry, Payne said. For a 10-year period ended in 1997, auto insurance profits averaged less than 5 percent in New Mexico, he said.

The bill would allow uninsured drivers to collect economic damages - for doctors' bills, car repairs and the like - from insured motorists who hit them. But they couldn't collect for claims such as pain and suffering, emotional distress or mental anguish.

Insurance companies said they would save money if uninsured drivers were barred from making big claims. And Johnson said it would encourage New Mexicans to buy insurance.

But opponents of the bill, including the New Mexico Trial Lawyers Association, said it would unfairly penalize safe - although uninsured - drivers who were hit by careless - although insured - drivers.